Read More

Beijing has vowed to immediately retaliate with its own tariffs on US soybeans and other farm products in a direct shot at President Donald Trump's supporters in America's heartland.

Cecilia Malmstrom, the EU's trade commissioner, acknowledged that the EU had targeted some iconic American imports for tariffs, such as Harley-Davidson motorcycles and bourbon, to "make noise" and put pressure on US leaders.

John Murphy, a senior vice president at the US Chamber of Commerce, estimates that $75 billion (£56 billion) in US products will be subject to new foreign tariffs by the end of the first week of July.

"It will be a disaster," said Nagesh Balusu, manager of the Salt Whisky Bar and Dining Room in London and expects the European Union's tariffs to add more than seven dollars (£5.20) to the price of a bottle of Jack Daniels, which is imported from Tennessee.

"It's going to hit customers, that's for sure. How they'll take it, we'll have to wait and see."

As painful as the brewing trade war could prove, many have seen it coming.

Mr Trump ran for the presidency on a vow to topple seven decades of American policy that had favoured ever-freer trade among nations.

He charged that a succession of poorly negotiated accords - including the North American Free Trade Agreement and the pact that admitted China into the World Trade Organisation - put American manufacturers at an unfair disadvantage and destroyed millions of US factory jobs.

He pledged to impose tariffs on imports from countries that Mr Trump said had exploited the United States.

Late last month, Mr Trump proceeded to infuriate US allies - from the EU to Canada and Mexico by imposing tariffs of 25% on imported steel and 10% on aluminium.

The president justified the move by saying imported metals threatened America's national security - a dubious justification that countries have used rarely because it can be so easily abused.

He is threatening to impose another national security-based tariff on imports of cars, trucks and auto parts.

Mr Trump has also started a trade fight with China over Beijing's sharp-elbowed efforts to overtake US technological dominance.

The White House last week announced plans to slap 25% tariffs on 1,100 Chinese goods, worth $50 billion (£37 billion) in imports.

Mr Trump would start on July 6 by taxing $34 billion-worth (£25 billion) of products and later add tariffs on an additional $16 billion (£12 billion) in goods.

The Chinese have said they will respond in kind.

Mr Trump said he would then retaliate against any counterpunch from Beijing by targeting an additional $200 billion (£150 billion) in Chinese products, and then yet another 200 billion dollars if China refused to back down.

All told, the $450 billion (£340 billion) in potential tariffs would cover nearly 90% of goods China sends to the United States.

"We oppose the act of extreme pressure and blackmail by swinging the big stick of trade protectionism," a spokesman for China's Commerce Ministry said on Thursday.

"The US is abusing the tariff methods and starting trade wars all around the world."

The tariffs and threats have begun to take a toll. Steel and aluminium prices, for example, have shot up and supplies have become scarce.